Organizational Communication: The Ultimate Guide

Who Should Read The Ultimate Guide To Organizational Communication

This practical guide is essential reading for anyone interested in organizational communication, including the following:

• Start-ups want to get their organizational communications off to the best possible start.
• SMEs with expanding employee numbers, working hybrid approaches in distributed teams.
• Larger corporates looking to ensure their organizational communications are in line with best practices.

What’s Included In This Guide

Topics covered in the guide include the following:

• Definition
• Why they are important
• The benefits
• The cost of poor organizational communication
• Barriers to effectiveness
• Different types
• How to develop a plan
• Selecting the right communications channels
• How to measure the impact of your communications

All the best ultimate guides begin with a definition, so here’s our take on the meaning of organizational communication.

What Is Organizational Communication?  

Organizational communication is a very broad term. And that’s one of the issues. Try googling ‘definition of organizational communication,’ and you will get many differing explanations. We prefer to keep it simple as follows: ‘Organizational communication covers any interaction between employees or managers and can be multi-directional and multimedia.’ They are the lifeblood of every business. Simply put, without organizational communication, it would be impossible to get anything done. Within the broad category of organizational communications are several sub-categories.

Formal And Informal Organizational Communication

Formal Communications

Sometimes called official communications, formal communications are how the business shares company-wide news and updates. It’s vital these important messages flow smoothly, accurately, and on time. We look in detail at the different types of organizational communications later in this ultimate guide. However, examples of formal communications include the following:

• Business updates
• Crisis communications
• Culture communications
• Change communications
• Information communications

Informal Communications

Often referred to as the grapevine, informal communications are those casual conversations and interactions between staff. Spontaneous and quick, informal communications are unofficial but are critical to supporting strong relationships, team morale, and camaraderie. Examples of informal communications include the following:

• Water cooler conversations
• Casual chats
• Phone conversations

Often included in this category are informal communications using official channels such as instant messaging apps or social intranets.

Directional Organizational Communication

Organizational communications take place on several levels as follows:

Downward Communications

These are top-down messages and so are usually formal communications. Managers are responsible for disseminating communications from executives down to all levels of the business.

Upward Communication

This is when staff get the opportunity to communicate directly with managers and executives. Examples include employee suggestion programs, staff surveys, and focus groups on specific initiatives or issues.

Horizontal Communications

Also called peer-to-peer communication, this type of organizational communication is between teams, groups, or individuals on the same level. Essential to cross-team collaboration, horizontal communication is often behind business innovation and ideation. As you can see, everyone has a role to play in organizational communications.

CEO And Board

Ultimately, the CEO and senior executives are responsible for ensuring effective organizational communications. This also involves identifying appropriate communication channels.

Managers And Team Leaders

Critical cogs in the communication wheel, managers are tasked with communicating up and down the company’s hierarchy.

All Employees

Every staff member has a responsibility to use their voice, provide feedback and collaborate with colleagues.

Importance Of Organizational Communication

Why is organizational communication so important? Well, it is the glue that binds the whole business together. Quite simply, organizational communication can make or break a company. And if you are in any doubt about the importance, these statistics make it crystal clear.

• According to Gartner, businesses with more informed employees outperform their peers by 77 percent.
• Research from McKinsey shows that productivity in organizations with connected employees improves by 25 percent.
• A study by ClearCompany suggests companies with effective communications are 50 percent more likely to have lower staff turnover.
• Holmes reports that the cost of poor communication to businesses is a whopping $37 billion.

Benefits Of Organizational Communication

What are the benefits of good organizational communication? Here we have identified the top eight, but there are a whole host more.

1. Employee Productivity

Effective organizational communications support employees’ job performance. From decision-making, information sharing, and ideation through to collaboration, good communications are critical.

2. Company Culture

Organizational communications help build a strong company culture, which provides purpose and meaning to employees’ work.

3. Cross-team Collaboration

Two heads are better than one. Organizational communication underpins joint working and supports innovation.

4. Knowledge Transfer

Information and internal knowledge flow more easily in companies with good organizational communications.

5. Employee Engagement

Respected commentators like Gallup have confirmed the connection between organizational communications and employee engagement. Employees with two-way communication lines are more engaged, motivated, and able to get the job done.

6. Staff Recruitment And Retention

Workers who feel informed, involved, and connected are more likely to stay longer with their employers. And organizations with reputations for being strong communicators find it easier to attract and recruit the best talent.

7. Improved Customer Satisfaction

Better organizational communications positively influence the employee experience. It naturally follows that happier, more motivated workers deliver superior customer service, which in turn impacts customer loyalty.

8. Increased Revenue

For most businesses, this is the icing on the cake. Improved staff retention, productivity, and customer satisfaction add up to make a significant difference to the bottom line. According to Gallup, this means a 20 percent increase in sales, 17 percent increase in productivity and 10 percent increase in customer satisfaction! Impressive, right?

The Cost Of Poor Organizational Communication

Various studies have tried to put a dollar figure on the cost of poor organizational communication. According to SHRM, this could be as much as $62.4 billion per year. And another study reports that 56 percent of project budgets are at risk because of poor communication.

More difficult to put a figure on are some of the softer impacts of poor communications. Damaged relationships, misunderstandings, increased frustration, and a breakdown in trust are harder to quantify but have no less devastating consequences.

Barriers To Effective Organizational Communication

Before you can begin to improve organizational communication, it’s vital to understand the barriers which may be getting in the way.

Organizational communication barriers will vary from business to business. In general terms, they can be divided into three broad categories:

Physical Communication Barriers

This category covers all physical barriers to communication. It could be closed office doors, geographically dispersed workplaces, remote working, and since Covid, social distancing rules.

Language Communication Barriers

Multi-national companies may employ workers who speak different languages from head office. These employees often also have different cultural experiences that impact communications. This category also covers tone, clarity, and the use of jargon in organizational communications.

Emotional Communication Barriers

A lack of trust, disengagement, and even fear can impact the effectiveness of organizational communications.

The world of work changed dramatically during 2020. The rise of remote working, distributed teams, and new digital communication channels have complicated the communications landscape. Here are some of the specific barriers to organizational communication that have emerged recently.

Remote Working

The gig economy, more non-desk roles, tech advances, and the global pandemic have accelerated the shift towards remote working. Distributed teams encompassing freelancers, contractors, and employees often working inter-state or even in different countries have become standard. And this new way of working has made effective organizational communications more challenging.

Information Overload

Already an issue for many employees, information overload has worsened since the onset of the pandemic. In one recent UK survey, 47 percent of respondents agree that the number of information sources they check each day has increased in the last five years. And with potential information sources including email, newsfeeds, social media sites, company intranet, shared drives, plus many more, it’s no wonder workers feel swamped.

Distraction

The constant ping of email notifications, instant messaging apps, and the lure of social media make it harder for staff to stay focused on what’s important. All that noise is simply overwhelming.

Shrinking Attention Spans

There’s evidence that our attention spans have decreased in response to information overload and our distracted lifestyles. According to Forbes, the average attention span is now just eight seconds, down from twelve seconds in 2000.

Complexity Of Communication Channels

Organizational communications were easy when the only options were email and the staff newsletter. Nowadays, the sheer number of channels makes it harder for employers to select the most appropriate channels to keep workers informed. And it becomes more challenging for staff to find the information they need. According to McKinsey, the average employee spends 20 percent of their time searching for internal information.

Different Types of Organizational Communication

This section provides an overview of the types of messages businesses need to get across every day. Understanding the kind of message will influence choices on how best to deliver the message and what channels to use.

General Business Updates

Keeping everyone informed of what’s going on is, of course, a primary focus of organizational communications. Usually top-down, it includes messages around company performance, industry news, product updates, or new services. Employees also need to know what’s happening in the wider industry.

Information Communications

Staff need a wide variety of information to get the job done safely and effectively. This type of communication includes policies and procedures, SOPs, product manuals, plus any new products or services in the pipeline.

Change Communications

Change is probably the only certainty in business. Effective and timely communications are needed to support change management. This type of organizational communications includes news about mergers and acquisitions, restructuring, staff movements, or new software. It also covers changes to the external operating environment, such as new rules and regulations or changes to legislation.

Crisis Communications

The global pandemic is an excellent example of crisis communications in action. However, this category also includes natural disasters, police or fire incidents, plus cyberattacks and system outages.

Culture Communications

These messages reinforce company culture and shared values. It could be team-building events, employee recognition, corporate charitable initiatives, or even social activities.

How To Develop An Organizational Communication Plan

Organizational communications are too important to leave to chance. Thorough planning and preparation are the foundations of success. Otherwise, grapevine communications and the rumor mill will take over. An innocent meeting with external consultants could easily be repurposed as a full-scale restructure once the grapevine kicks in.

But how do you get started on developing your organizational communications strategy? Here we make it easy for you. All you need to do is follow the five easy steps identified below.

Five Steps To Developing An Effective Organizational Communication Strategy

1. Review Your Current Organizational Communication

Starting with a blank canvas is always daunting. However, there are bound to be some elements of your current organizational communications that are working well. And no doubt, there’s also room for improvement.

Start by reviewing where you are at. And make sure you involve employees in the review. After all, the success of your strategy depends on staff joining you on the communications journey. Use the following questions to guide your thinking:

• What communications channels work well?
• How do employees like to receive information?
• Which channels prompt the most action from workers?
• How are you engaging with distributed teams?

2. Know Your Audience

Even small businesses are made up of a diverse group of employees. These workers will be performing different roles in various teams, but they will also have individual communication preferences. In the past, companies have been guilty of impersonal, generic communications. Remember the all-staff email? In reality, these messages are often only relevant to a small section of workers rather than everyone. When information overload is a real problem, it’s no wonder impersonal all-staff emails often remain unopened.

Identifying your audience is a critical step to successful organizational communications. Today’s diverse and tech-savvy employees expect segmented, personalized, and most important of all, relevant communications.

So, who are the internal audiences in your business? There are various ways you can break down your internal audience. Here are a few ideas:

• Full-time and part-time staff members
• Remote workers
• Freelancers and contractors
• Non-desk employees (perhaps on-the-road sales personnel, field technicians, or manufacturing staff)
• Multi-generations – Baby Boomers, Gen X, Millennials, etc.
• Role-based audiences – admin, managers, sales staff, and so
• Departmental workers – HR, marketing, finance, etc.

Once you have identified your internal audiences, it’s time to think about their likes, dislikes, and communication styles. For example, digital natives like Millennials and Gen Zers are more likely to favor social communication platforms. Whereas Baby Boomers usually prefer face-to-face communications or traditional media like staff newsletters. Furthermore, non-desk staff will want mobile-friendly communications. And head office-based employees are likely to be using desktops for organizational communications.

A better understanding of your audiences and their information needs will help you tailor your messaging. And it will help you to select the most appropriate communication channels. There’s more on communication channels later in this ultimate guide.

3. Set A Budget For Your Organizational Communication

Be clear from the start about what funds and resources are at your disposal. After all, organizational communications are a business-critical activity and deserve to be properly resourced. Plus, setting objectives and goals without knowing the financial parameters is tough. A clear budget helps you prioritize what’s achievable.

4. Set Objectives For Your Organizational Communication

Having an overarching objective for your plan provides a focus and framework. For some businesses, the top priority will be engaging with remote workers. For others, it could be improving the employee experience or developing corporate culture. Whatever you do, please keep it simple. It’s best two have one or two main objectives. Too many goals become unachievable and also dilute your primary purpose. Don’t forget that your priorities will change over time. Next year’s plan may well have an entirely different focus from this year’s one.

When formulating complementary goals that feed into the overarching objective, be sure to use a planning tool to help. Some people find the SWOT (strengths, weaknesses, opportunities, and threats) analysis a helpful technique. Others prefer the 5 Ws and H (why, what, who, where, when, and how).

Whatever technique you use, make sure your objectives are SMART:

• Specific
• Measurable
• Attainable
• Realistic
• Timebound.

And always make a direct link with corporate goals and KPIs. After all, organizational communications should support your overall business goals.

5. Test Out Your Plan On Staff

Before you finalize the organizational communications plan, please test it out with a sample group of staff. This vital step will help you finetune the strategy and provides validation that you are on track.

Ask workers to review the draft objectives and identified communication channels. Is the language accessible, and does it set the appropriate tone? Are the specified channels the right ones? Is it clear who is responsible for what and when? Does the plan address the ‘what’s in for me’ question in the minds of the workforce?

Take the feedback on board and revise your organizational communications strategy accordingly to reflect the learning.

How To Select The Right Communications Channels

Organizational communication channels are the mediums used by organizations to convey information and messages to each other.

One thing for sure is there’s no shortage of communication channels to choose from. Advances in technology have made it a more difficult choice than ever before. The right communication channel depends on several factors. These include the audience, the type of message, your budget, and the urgency of the communication.

Here’s a run-through of some of the most popular channels with suggestions on their best use.

Intranets

For many businesses, company intranets are the number one medium for organizational communication. Cloud-based and mobile-friendly intranets are accessible to all staff regardless of location.

However, the best thing about intranets is they offer several tools and features to support organizational communications. Under one virtual roof are all these great communications channels:

• Personalized newsfeeds
• Company blogs and vlogs
• Instant messaging
• Document sharing
• Forums and collaboration project spaces
• Employee profiles
• Team or individual activity walls
• Follow-me functionality

Intranets are a comprehensive organizational communications solution that tick a lot of boxes all at once.

Town Hall and Team Meetings

More challenging in the era of physical distancing, town hall or team meetings over video conferencing apps are still a popular option. Use them to bring all staff together to share company-wide or team news and celebrate success.

Webinars

These online events are smaller versions of the town hall meeting and are a good platform for connecting with freelancers and contractors. Use them for team huddles, knowledge-sharing, and inviting feedback.

Email

An oldie but still a mainstay in many businesses. Email allows you to reach large groups of people quickly. However, with email, there’s no room for interaction or feedback.

Instant Messaging (IM)

The new kid on the block, IM apps, and team chat provide real-time communication. Available as public or private chats and with familiar # channels, IM is instant, accessible, and user-friendly. It’s perfect for encouraging water cooler conversations among remote workers. And it also supports faster, more agile decision-making.

Employee Surveys

Annual staff opinion surveys have been around for a long time. However, these days employers are using shorter snap polls and pulse surveys to invite feedback on specific issues. Employee surveys support two-way conversations between the workforce, managers, and executives.

Staff Newsletters

A firm favorite with employees of all generations. Nowadays, the staff newsletter is more likely to be an online version rather than a hard copy. Some companies are even incorporating video and podcasts into their newsletters to tell stories. Indeed, storytelling has grown in popularity as a powerful and easily relatable way to convey memorable messages.

Social Media

Let’s face it, social media is a part of everyone’s daily lives. So, it’s no surprise that businesses are leveraging social media to connect with and inform employees. The likes of Twitter, Facebook, and LinkedIn are now also essential business communication tools.

How To Measure The Impact Of Your Organizational Communication

An organizational communications plan is meaningless if you are unable to measure its impact. Devising a set of metrics will help you track progress and measure success over time. It will also help you demonstrate ROI.

However, organizational communications are one of those areas of the business that’s hard to pin down. And so, a mix of quantitative and qualitative measures is needed to help you build a comprehensive picture.

Qualitative Data

Employee pulse surveys and focus groups are possibilities, especially when used to obtain feedback on a communications initiative. For example, the social media campaign you undertook to inform staff about the new wellness package.

Another possibility is periodically analyzing employees’ feedback and comments on company blogs or the intranet’s newsfeed. Also, keep an eye on staff reviews on sites like Glassdoor or Indeed.

And why not set up a dedicated #channel on IM so staff can share their insights and ideas.

Quantitative Data

Possibilities include statistics on reach – number of views, downloads, attendees, or click-through rates. Furthermore, monitor employee retention rates, staff turnover, and increased employee satisfaction, as demonstrated through employee surveys and snap polls.

Monitor And Review Your Organizational Communication

Just as important as monitoring progress is reviewing the plan to ensure it’s still fit for purpose while continuously improving. Even 12 months ago, no one could have predicted the enormous changes Covid would unleash. Organizational communications will evolve over time, and your priorities will change. Incorporate a high-level review at least annually to ensure your organizational communications are still hitting the mark.

And it almost goes without saying, but don’t forget to keep the workforce informed of any changes. After all, organizational communications are the shared responsibility of every employee. For instance, if you find that video is the most popular communication channel, adjust your plan to include more. And let staff know the how and why.

Develop A Communications Calendar

Our final tip is to develop a company-wide communications calendar. Accountability and transparency are important in organizational communications. You should, of course, publish the entire document on your intranet and publicize it widely among the workforce. But in today’s fast-paced workplaces, few employees will read and digest a lengthy plan that may not be entirely relevant for them and their daily jobs.

An organizational communication calendar is more accessible and allows staff to see at a glance what’s coming up and when. Showcase your internal communications initiatives alongside team or role-based events, launches, and webinars.

Transform Your Organizational Communications

There’s no doubting; organizational communications are critical to your company’s success. Yes, it’s a big challenge but breaking it down into bite-sized chunks makes it a more manageable task. This guide has done just that for you. Here’s a quick recap of what we have covered:

• The definition of organizational communication and why they are so important
• The business benefits of good organizational communication
• Barriers to effective organizational communication
• Five steps to developing an organizational communications plan
• Organizational communication channels and how to make a selection
• How to measure the success of your organizational communications.

There’s something for everyone in this ultimate guide to organizational communication, including:

• start-ups wanting to get things right from the get-go
• established businesses looking to refresh and revitalize their approach to organizational communication
• larger companies wishing to benchmark against current best practice data.

McKinsey’s latest survey on employees’ experiences of remote working offers an interesting insight into the importance of communication. Staff who feel included in more detailed communication are nearly five times more likely to report increased productivity.

However, research from Gallup suggests that only 13 percent of workers strongly agree their leadership communicates effectively with staff.

The stakes are high. Use the steps in this ultimate guide to ensure your organizational communications are ready to meet the challenges ahead.

MyHub’s cloud intranets support organizational communications in businesses worldwide in a wide variety of industries. Designed by the experts with the non-expert in mind, our super-easy intranet solutions can transform organizational communications in your business. Find out more with a free demo or no-obligation trial.